ACT Government to support local jobs with two year stimulus package

ACT Chief Minister Katy Gallagher MLA has today announced a package of initiatives designed to provide confidence and economic stimulus for the ACT building and construction industry.

"The package being announced today will support local jobs, target areas where we can provide some certainty to the business community and modify certain fees and charges to better reflect the current economic conditions," the Chief Minister said.

The four elements to the package being announced today include:

releasing at least four civil contractsfor estate works in Moncrieff;

changes to lease variation charges (LVC);

a significant reduction in extension oftime (EOT) commence and complete development fees; and

the drafting of legislation to facilitate major projects across the ACT.

Moncrieff civil works

The bringing forward of at least four civil works contracts at Moncrieff will see construction activity that was originally scheduled over a 3-4 year period being undertaken concurrently. This will have the effect of driving economic activity as well boosting housing supply.

The release of the contracts at Moncrieff will also contribute towards meeting the Government's target of 20% affordable dwellings in greenfield development sites in line with our commitments in the Affordable Housing Action Plan.

Lease variation charge

Changes to the lease variation charge system will include all codified LVC fee and remissions schedules being frozen at the current rate and remission level for the next 2 years.

For non-codified variations, the remission rate will be increased from 25% to 50% for the next 2 years.

A further 25% remission is available for developers who incorporate high standards of sustainable design and adaptable housing into their projects.

The new remissions will apply to all eligible cases assessed after the date of announcement up until 6 March 2016.

Extension of time - commence and complete

The ACT Government will be simplifying and significantly reducing EOT charges. From 1 April 2014, EOT fees will be applied on completion breaches only. EOT fees will not be charged on the first four years of breach. From the fifth year EOT fees will be billed annually at one times the general rates bill.

EOT debts that accrued for the period 1 July 2012 to 31 March 2014 EOT fees will be waived. For debts accruing from 1 April 2014, the EOT will be determined based on one times the general rates.

For eligible people and businesses who have paid EOT fees during the waiver period, a refund equal to the component of their fee that accrued after 1 July 2012 will be available on application. This ensures that those who have and have not paid the fees during the period are treated equally under the reforms.

Project facilitation legislation

As foreshadowed in the Legislative Assembly last week the government will be bringing forward legislation in the next sitting week that will allow identified priority projects the certainty to proceed.

"This package responds in a timely way to local industry feedback about the need to support local jobs, provide certainty to business with a program of upcoming works and to provide short term stimulus for the continued development across the city," the Chief Minister said.

"In finalising this package the government has worked closely with the peak industry groups who have advised us on the issues and pressures facing particular sectors across the ACT.

"I would like to acknowledge the Masters Builders Association, the Canberra Business Council, the Property Council of Australia, the Housing Industry Association and the ACT Chamber of Commerce and Industry for their work and their advocacy on behalf of their members.

"One of the great things about living in Canberra is when the city is under pressure - as it is from impending Commonwealth Government spending cuts - peak groups work closely with the government to meet the needs of the local community," the Chief Minister concluded.

The cost to the ACT budget of delivering the reform package is approximately $13 million over 3 years.

The civil works in Moncrieff are estimated to be approximately $150 million.